Discussions of the economic costs and benefits of EMU usually take as their basis the optimum currency area (OCA) approach. This approach starts from the premise that when an external shock hits the economy, it is easier to adjust the exchange rate than domestic prices or wages. Most economists...

This paper examines the interactions between money, interest rates, goods and commodity prices at a global level. Aggregated data for major OECD countries are therefore analysed in a cointegrated VAR framework. Our empirical results for the period ranging from the 1970s to 2008 support the view...

This paper provides a closer view on the interaction of exchange rate volatility and interest rate volatility in the Mercosur countries. We discuss several models that explain systematic correlations between the movements of both variables and their secon

This study examines the long-run relationship between monetary policy and dividend growth in Germany. For this purpose, cointegration is tested for between both variables in the period 1974 to 2003. However, problems related to spurious regression arise from the mixed order of integration of the...

This paper surveys earlier studies by the authors, which examine the specific costs and benefits to labour markets from suppressed exchange rate variability. These papers started from a simple model that explains the transmission channel between exchange rate volatility and the labour market and...

This paper empirically assesses the ability of dividend yields to predict future tock returns in Germany assuming efficient markets and rational expectations. Since the order of integration of repressors are not exactly known, a bound procedure, namely a n autoregressive distributed lag (ARDL)...

This paper empirically assesses the impact of OECD exchange rate uncertainty on German employment claimed by real option theory. Since orders of integration of regressors are not exactly known, a new bounds procedure is applied to test for cointegrating relationships among macroeconomic labour...